Reporting entity B produce a new asset, and emit in the production process carbon for a total value of 100 CU. The reporting entity uses a production process which is representative of the standard production process of its industry. This results in a fair value of 100 CU for the Embedded Carbon Asset produced. The reporting entity further determine that 25% of the asset cannot be further reused in a future production process. Finally, the reporting entity estimate that the total value of the carbon that will be emitted over the useful life of the asset is 30 CU.
The following bookings would take place.
Theses bookings would lead to the following final Carbon Balance sheet and Carbon Profit and Loss:
